Fuel prices are continuing to rise and have already reached historic highs in the Czech Republic. The government has therefore decided to abolish the mandatory blending of bio-components into fuels and also to abolish the road tax on vehicles weighing up to 12 tonnes. But is it enough? And how will inflation impact the country’s industry and its citizens? I put these questions to Jan Vejmělek, chief economist at Komerční banka.
“Maybe I can start with a brief description of how important energy prices are for the Czech economy. The Czech Republic is an industrial country and has one of the highest industry per GDP shares in the European Union. Unfortunately there is quite a high level of energy intensive production here, which in turn means that the rise in prices means a huge rise in costs for Czech manufacturers.
Author: Tom McEnchroe